Shares in easyJet flew up 7.5 per cent after the budget carrier slashed its losses forecast yesterday thanks to good weather, other carriers going bust, and passengers being charged higher fees.

The airline said its revenues will rise 10 per cent in the six months to April, up from an earlier estimate of single-digit growth. That is mainly due to what it calls "ancillary earnings" – in January easyJet replaced its booking fee with a £9 administration charge and made passengers using credit and debit cards pay an extra 2.5 per cent. The carrier also said its de-icing costs had fallen by £18m compared with a year ago.

EasyJet also set out details of a trial of allocated seating. From next month, flights from Luton to Sharm el Sheikh, Malaga, Alicante and Istanbul and from Glasgow to Alicante will have allocated seats. But its chief executive Carolyn McCall said the move would not go ahead if it affected the airline's 25-minute turnaround.

The airline said its pre-tax loss for the six months to April would be £110m-£120m, down from a January forecast of £140m-£160m. Losses are set to widen to £145m in the second half.